U.S. History ll Chapter 9 and 10 (McGraw-Hill)

When did the first crash in the stock market occur?

October 24, 1929

Millions of people lost their life savings within BLANK.

hours

Did people believe that the prosperity of the 1920's would stop?

No, people believed that the success of the '20s would continue.

Most Americans believed that the BLANK was a great way to get rich quickly.

The Stock Market

What is a Bull Market?

the upward trend in stock markets

What is stock speculation?

buying and selling stock to make a quick profit

Speculation fueled BLANK in the economy

growth

Stock Speculation created such a large demand that many stocks were selling for BLANK than they were worth

more

What was the problem with stock speculation?

as long as demand was high, speculation was profitable, but if investor confidence weakened prices would tumble

What is margin buying?

purchasing stocks with borrowed money.

Investors were paying as little as BLANK upfront for their stocks with margin buying.

10%

What was the problem with margin buying?

If prices fell, investors would acquire a debt that they would not be able to repay

What was October 24th 1929 known as? What happened?

"Black Thursday" ; A panic created by several factors caused many share holders to sell, with no one to buy, driving prices down quickly

What was one of the factors that led to the stock drop on Black Thursday?

Rising interest rates

What was October 29th 1929 known as? What what happened?

"Black Tuesday" ; a second wave of panic created an even bigger drop where even more investors dumped their stocks with no one to buy

As prices plunged, what did brokers do?

They demanded cash for repayment of all loans

By mid November, stockholders lost how much money?

$30 million

Name 3 Effects of the Stock Market Crash

1. Americans who had margin loans lost everything and still could not pay off their debts

2. Even investors who did not buy margin loans had worthless shares

3. The booming 20s caused many factories to overproduce

With overproduced goods, factories had to do what?

Lay off workers

Companies would not hire people with a shrinking market place, creating what?

A cycle of unemployed workers unable to buy products, causing business to cut back even more

In the first few months, business leaders and President Hoover insisted what?

The set back was minor

What is Gross National Product?

the total value of all goods and services produced in a given year

What does GNP stand for?

Gross National Product

What was the GNP of 1929? 1933?

1929= $103 billion

1933= $56 billion

From 1929-1933 the average income of Americans fell by how much?

50%

What 2 things led to the failure of the banking industry?

1. Investors who failed to repay loans panicked and withdrew all of their money

2. Banks invested private investors' funds into the stock market

How many banks closed between 1930-1932?

5,000

A system for buying and selling stocks in corporations

Stock Market

A long period of rising stock prices

Bull Market

A long period of falling stock prices

Bear Market

Buying stock by paying only a fraction of the stock price and borrowing the rest

Buying on Margin

A measure of the value of leading industrial companies

Industrial Index

Demand by a broker that investors pay back loans made for stocks purchased on a margin

Margin Call

Persistent and heavy demands by a bank's depositors, creditors, or customers to withdraw money

Bank Run

Homeless, broke person

Hoboe

A drought struck the Great Plains, leaving the soil dried to a dust. it stretched from Dakota to Texas

Dust Bowl

Which states did the Dust Bowl span?

Dakota to Texas

Former owners of land in the Dust Bowl who are now moving to CA in hope of better land

Okies

Where were most Okies from?

Oklahoma

Projects such as highways, parks, and libraries built with public funds for public use

Public Works

What does the Reconstruction Finance Corporation do?

loaned money to businesses in hope of helping the economy

What does RFC stand for?

Reconstruction Finance Corporation

Was the Reconstruction Finance Corporation successful?

No, it failed to increase its lending sufficiently and the economy declined

Taking procession of property from a mortgagor because of defaults in payments

Foreclosed

Vetrans of WWI who were promised to receive a bonus of $1,000 in 1945. These veterans marched to lobby for the legislation of a bill to grant these bonuses early

Bonus Army

Closing of Banks during the Great Depression to avoid bank runs

Bank Holiday

Radio broadcast made by FDR to the American people to explain his initiatives

Fireside Chats

Which group regulated the stock market and stopped fraud?

Securities and Exchange Commissions

What does SEC stand for?

Securities and Exchange Commissions

Which group provided government insurance for bank deposits?

Federal Deposit Insurance Company

What does FDIC stand for?

Federal Deposit Insurance Company

Which group helped farmers refinance their mortgages?

Farm Credit Administration

What does FCA stand for?

Farmers Credit Administration

Which group offered unemployed young men the opportunity to work under the direction of the forestry service?

Civillian Conservation Corps

What (3) jobs did men do under the forestry service?

1. Planted trees

2. Fought forest fires

3. Built reservoirs

What was the age gap that the Civilian Conservation Corps allowed to work under the forestry service?

18-25 years old

What does CCC stand for?

Civillian Conservation Corporation

Which group gave money to state and local agencies to fund relief projects?

Federal Emergency Relief Administration

What does FERA stand for?

Federal Emergency Relief Administration

Who ran the Federal Emergency Relief Administration?

Harry Hopkins

Government practice of spending borrowed money rather than raising taxes, usually in attempt to boost the economy

Deficit Spending

Process in which a neutral party hears arguments from two opposing sides and makes a decision that both parties must accept

Binding Arbitration

Method of Boycotting work by sitting down at work and refusing to leave the establishment

Sit-Down Strike

Who was the governor of Kansas?

Alfred Landon

Who ran against FDR in the 1936 election?

Alfred Landon

What was Alfred Landon's campaign slogan in the 1936 election?

"Free the Spirit of the American Enterprise"

Provided some financial security for older Americans, unemployed workers, and others; Workers paid special taxes to receive benefits of they needed them

Social Security Act

The act of a leader to change the political balance in the nation's judiciary system by appointing judges who will rule in favor of his/her policies. This is a major political mistake

Court Packing Plan

What established the U.S. Housing Authority and received $500 million to subsidize loans?

National Housing Act

Which group tried to combat rural poverty?

Farm Security Administration

When the banks failed, what would they do?

Board up

What 4 factors caused the depression?

1. Stock market crash

2. WWl

3. The American economy was not sound

4. A mismanaged economy

Why did WWl help cause the depression?

The global economy suffered enormous setbacks because of the massive war debts incurred by European countries

America in the 20s was a BLANK based economy

Credit

Inspired by BLANK, consumers acquired BLANK that was not easy to repay

Low-interest rates; debt

Smoot-Hawley Tariff was...

The highest tariff in U.S. History and contributed to the troubles of European countries

The Great Depression lasted most of BLANK

The 30s

By 1932, BLANK million Americans were unemployed

12 million

For the first time in many years, immigration...

Was at a stand still

When factories laid off of employees BLANK were the first to go

Blacks

What are bread lines?

Lines people waited for watery soup and dry bread in

What are Shantytowns?

Urban homeless communities made up made up of packing boxes, scrap lumber, and other throw-away items

What are Hoover blankets?

Newspapers used as blankets by the Hoovervillians

What are Hoover flags?

Pulled out empty pockets

Shantytowns are also called...

Hoovervilles

Which group did not enjoy the success of the "roaring 20s"? What impact did that have on them in the 30s?

Farmers; The depression hit them especially hard

While people in cities were in need of food, what did farmers do with their overabundance of food?

They let crops rot and killed livestock they could not feed

Hoboes were mainly BLANK (gender) or BLANK (age group) who left their families behind?

Men / Teenagers

About how many teenage hoboes were there?

250,000

Even though the depression would end, the behavior and outlook of the people involved in the depression would last for BLANK

a lifetime

Prior to the depression, Hoover was actually BLANK. Most Americans had believed that gov should BLANK in business.

Popular; stay out of business

Little government involvement in business is referred to as BLANK

free market system

During the depression, most people expected the government to BLANK in business

get involved

The Hoover dam separates what states?

Nevada and Arizona

What 2 goals did the Hoover dam achieve?

1. Stimulated business

2. Provided relief

How did the Hoover dam stimulate business?

It provided contracts for construction and materials

How did the Hoover dam provide relief?

It employed jobless workers

How much money did Hoover approve to be used towards public works?

$800 million

The Hoover dam did provide an example of and associative state, however it was unable to BLANK

Stimulate the economy

With economic disaster everywhere, most individuals and businesses made decisions according to what?

Their own economic interests